UNIVERSITY GUIDELINES

Table of Contents

A. 30-Day Payment Requirement

The Prompt Payment Law (Texas Government Code Chapter 2251) establishes when payments are due. This law stipulates a payment is due for goods or services 30 days from the date goods/services are completed, or a correct invoice is received, whichever is later.
Disbursements & Travel Services (DTS) picks up mail from the mailroom twice a day and date stamps all invoices with the same date. This begins the clock for calculating the 30-day payment requirement.
It is very important that invoices be addressed to DTS and not to a department or other campus location. If a department receives a vendor’s invoice directly, the department must date stamp it when received. That will constitute the first date for calculating the 30-day payment requirement.

Payments will be scheduled as close to the 30th day as possible per the Prompt Payment Law. Payments scheduled on weekends, The University of Texas at San Antonio (UTSA) and state holidays will be mailed (postmarked) or electronically paid within the 30-day payment requirement.

Payments are processed earlier than the standard 30-day processing time when:

An early payment discount is available per terms of the purchase order, or as stated on the invoice;

A contract requires pre-payment before goods or services are received;

Exceptions to the payment due date other than those stated above must show benefit to UTSA and be pre-approved in writing by the Director of DTS, Assistant Controller or Assistant Vice President, Financial Affairs/Controller (AVPFA/Controller).

Interest for an overdue payment will be calculated in accordance with the Prompt Payment Law per guidance provided at the State of Texas Comptroller’s website. The State Comptroller determines the interest rate to be charged; this rate is updated in UTSA’s financial accounting system and automatically computed when applicable.
A payment is considered overdue beginning the 31st day from the date goods/services are completed, or a correct invoice is received, whichever is later. The payment owed to the vendor begins to accrue interest on the date it becomes overdue. Interest will not accrue or be paid if the amount is less than or equal to $5. Interest stops accruing for overdue payments on the date the check is mailed or electronically transmitted.
Interest on any overdue payment (and due dates) will NOT be overridden unless properly authorized and documented in writing by the Director of DTS, Assistant Controller or AVPFA/Controller.

DTS will pay interest — up to the distribution date — on any past due payment, even if the vendor has an outstanding warrant hold (see Vendor Hold and Vendors Indebted to the State).

C. Exemptions

The Prompt Payment Law exempts payments of $5,000 or less from mandatory payment scheduling. UTSA at its discretion may choose to pay invoices according to the Prompt Payment Law or may schedule the payment due date as soon as they are processed. Individual invoices grouped in a monthly statement cannot exceed $5,000 to qualify for the agency discretion exemption. Any exemptions made must show benefit to UTSA.

D. Vendor Hold

DTS is required to verify a vendor’s hold status through TINS for all payments made over $500. If a vendor has a hold, DTS will notify the vendor by mail that a hold has been placed on the vendor’s TIN by a state agency. The vendor must contact either the State Comptroller’s Office or the state agency placing the hold to resolve the situation and have the hold released. The vendor must notify UTSA when the hold has been released by the State Comptroller’s Office or state agency before any checks can be released.

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E. Disputed Shipments or Invoices

If there is a dispute with the invoice or shipment, the vendor must be notified via e-mail or telephone within 21 days of the receipt of the invoice.

The disputing department and/or DTS are required to document all relevant information on a Vendor Dispute form. The form requires

:

Nature/reason for the dispute/discrepancy;

Dates of the dispute/discrepancy;

Details regarding communication with the vendor regarding the dispute/discrepancy, including phone numbers and contact names;

Dispute/discrepancy resolution and in whose favor it was resolved.

A corrected invoice must be submitted by the vendor for all disputes resolved in favor of UTSA.

If the dispute is resolved in favor of the vendor, then the overdue payment is eligible for interest and it is calculated from the original due date.

NOTE: When the department is responsible for disputing the invoice or shipment, the completed forms must be sent to DTS with the related payment documentation.

F. Vendors Indebted to the State

A vendor is not entitled to interest for any time period that the vendor was indebted to the state. If during the payment processing it is determined that a vendor has a “hold” with the State of Texas the payment will be processed; however, the check will be held until the indebtedness is cleared. A vendor hold is placed by the State Comptroller’s Office or state agency if the vendor:

DEFINITIONS

Term

Description

Date Stamp

The date stamped on an invoice when first received by the UTSA department that received the goods or services or DTS.

The “date stamped” on an invoice indicates the invoice received date and is used to schedule the payment due date as close to the 30-day requirement, while accommodating the scheduled check runs and holidays, as stated in the Prompt Payment Law.

Interest Rate

The rate of interest used to calculate the interest amount due, is the rate in effect on September 1st of the fiscal year in which the payment becomes overdue.

As stated in the Comptrollers website: The interest calculation is one percentage point higher than the prime rate published in the Wall Street Journal on the first business day of July.

Invoice

"Invoice" in the context of the Prompt Payment Law means a vendor's request or demand for payment. A vendor might use the term 'statement' when requesting payment from an agency. In this case, the 'statement' should be considered the vendor's invoice. However, some vendors use documents called 'statements' to assist agencies in tracking payments or charges but no payment is being demanded or requested by the statement itself. In this case, the statement would not be considered an invoice because the statement is not actually requesting or demanding any particular payment. In general, whenever an agency receives a request or demand for payment, then the document should be considered an invoice for prompt payment purposes. For more information see Texas Government Code Section 2155.382(d).

Mailing of Payment

A payment is considered to be mailed on the date the payment is postmarked or electronically transmitted. UTSA mails checks the day they are printed and therefore the date of the check serves as the date mailed.

Payment Due Date

The date 30 days after the later of:

The date goods or services are received, OR

The date the invoice is received

Prompt Payment Law

The Texas Prompt Payment Law (Texas Government Code Chapter 2251) requires agencies to pay interest to vendors and the interest be included with the payment when payment is not made by the 30th day after the latest of:

The date the agency receives the goods under the contract

The date the vendor completes performing its services for the agency or

The date the agency receives an invoice for the goods or services

Vendor

Under the Prompt Payment Law:

Does not include another state agency-interest between state agencies is neither required nor authorized

Any person or business who provides goods or services to a state agency

When acting in a private capacity, and supplying goods and/or services to a state agency, this may include an officer or an employee of the agency